The goal of OCFB is to build a sustainable brand that will help displace beef products from other jurisdictions that compete against the Ontario beef industry. In order to do this, we have remained focused on providing consumers with a consistent, great-tasting beef product that is produced in accordance with established food safety and quality standards. We have also developed a recognizable logo that helps consumers identify the product. The symbols assure them of our pledge to deliver an authentic Ontario beef brand. Simply put, our brand is our promise. It’s a promise in pride, professionalism, progress, innovation, and producer satisfaction. As we move into 2010, I believe an Ontario branding strategy will be the key to competing with the ever-increasing supply of imported beef.

Recession Hits

We came out of 2008 riding a wave of optimism that grew from our new relationship with Loblaws. Despite that success, the looming recession caused me to lower my expectations for further growth in 2009. Retailers and food service providers revised their programs as they searched for ways to cut costs. The soaring Canadian dollar proved to be a double-edged sword for Ontario’s beef producers: it reduced our cattle prices and it also paved the way for cheaper US products to flood our markets. The economic downturn was also tough on our consumer base, providing no financial gains for the typical families who buy our brand.

Our worst fears about the business climate were realized when Loblaws ended their partnership with us in April. By all reports from the company, the Ontario Corn-Fed Beef program was performing well in early 2009: we were seeing growth, Loblaws’ grosses were up and customers were asking for the product at the stores. Our discussions with Loblaws’ officials were going in a positive direction, pointing toward the possibility of our products becoming more integrated with the Weston group of companies. By March, however, there were rumblings about changes at Loblaws. We were called to the company and were informed in a 10-minute meeting that we were no longer needed. We were one of 500 small suppliers that were dropped because of the decision. Loblaws was going with a national President’s Choice brand as a part of an effort to restructure and streamline their warehouse operations. With the generic brand, the company could promote and sell the products across all of its store banners, eliminating the need for specialized flyers and advertising. It also meant that they could buy beef from the cheapest source. The result was a dramatic drop in the number of cattle produced under the OCFB program. Before Loblaws’ decision, we were processing 2,300 cattle a week in early 2009. By November, the number was down to about 1,100 per week. Obviously, the partnership with the company turned out to be less than what we expected. We believed that they would base their thoughts about sales on growing the product line over the long-term and promoting the “buy local” theme.

Instead, it was a short-term proposition.

While Loblaws’ move was a setback, we discovered some valuable points about the OCFB program. We learned that the brand stabilized beef prices at the stores’ meat counters, which translated into higher beef sales and more stabile pricing.

From consumers, we learned that it is difficult for people to find Ontario-produced beef, especially if small, independent retailers are not close to where they live. In fact, consumer demand prompted three Loblaws stores to buck the company trend and revive the OCFB program at their meat counters.

Growing the Ontario Corn-Fed Beef Brand

The notion of consumers wanting an Ontario brand was not lost on other beef customers. We have been working with another major retailer that has shown interest in possibly marketing the OCFB program. Gaining a foothold in a major chain, however, is a challenge, especially when you’re one of about 1,000 other suppliers looking for space. One drawback is the “up charge” or “cost-neutral fee” that the major stores expect you to pay. It can cost anywhere from 5 to 10 cents per pound to carry your brand. Then you add the price of point-of-sale materials to the mix.

One factor that was extremely important in the Loblaws deal was our decision to stay with our original customers. During negotiations, Loblaws asked us to drop the small gourmet butcher shops and retailers from the program. But we never did that. Instead, we continued to build relationships with those groups. 125 of these butcher shops and retailers carry our brand today. We also recently added Denninger’s to our roster. The company, which is a well-established gourmet food business, has six retail stores in the Hamilton area.

Meanwhile, we have expanded our branded program in the United States. There continues to be strong interest from our first American customer, Stauffers of Kissel Hill in Pennsylvania. The Beef Information Centre deserves a lot of credit for our success in the US market so far. We have a close working relationship with the BIC’s Sales Team that is led by John Baker, Jeff Trafford and Marty Carpenter. It is an effort that effectively utilizes some of the dollars we pay to the national check-off. For our American customers, the attraction is not so much about the name on the brand, but what the brand is all about. There’s keen interest in our feeding program and food safety protocols. As a result, I believe there is significant growth potential along the Eastern seaboard. The strong Canadian dollar, however, could be a limiting factor.

Besides our retail partners, we continue to build relationships with the food services sector. We have been working with Morton Wholesale in Windsor since 2004. Our business with this leading food distributor in southwestern Ontario is growing and flourishing. More recently, we have partnered with Gordon Food Service. Our relationship with Gordon’s, along with the efforts of the Beef Information Centre, created a new business opportunity for OCFB with Prime Restaurants of Canada. Casey’s, which is one of many chains operated by Prime, featured an Ontario Corn-Fed Beef T-bone steak on its summer menu and the fall line-up included an OCFB rib steak.

The comments from the new customer were extremely gratifying.

The people at Casey’s said they attracted customers who wanted locally-produced food. Meanwhile, the quality of our products exceeded their expectations.

Another highlight of 2009 was the launching of a new product at the Grocery Innovations Show in Toronto in October. “The North of 90” breakfast beef is being produced by the partnership of Ontario Corn-Fed Beef and St. Helen’s Meat Packers. It utilizes cuts of beef for a breakfast product that meets the requirements of people who traditionally do not eat pork. We’re seeing keen interest in the product, which is similar to sliced side bacon. The product is still in development but we hope it will be available to consumers in 2010.

Prior to the Grocery Innovations Show, we launched our mobile unit – the “There’s No Taste Like Home” trailer. Although it wasn’t officially unveiled until August, we were able to display it at several key events. We’re proud that it will part of the Ontario Pavilion at the upcoming Winter Olympic Games in Vancouver. We look forward to using the vehicle as a way to raise consumers’ awareness of our products and entice them to ask for Ontario beef at retail counters.

OCFA and OCA Define Roles

This will be a significant year for the partnership of the Ontario Cattle Feeders’ Association (OCFA) and the Ontario Cattlemen’s Association (OCA). In October, the organizations re-defined their roles to better serve Ontario’s beef producers. Although OCFA and OCA worked in unison on various political issues, we were still being viewed as two separate organizations. It was decided that OCFA would step back from the political arena and allow OCA to become the voice for the industry on policy and government relations issues. Given the OCFA’s strengths in branding and marketing, we will focus our efforts – with assistance from the OCA – on moving forward with the Ontario Corn-Fed Beef program. We will continue to have members who will run to sit on the OCA’s Feedlot Committee.

I would say that the OCFA-OCA partnership is a success story.

My OCA counterpart, Dave Stewart, and I have a good working relationship and I look forward to seeing the new partnership produce benefits for beef farmers in the future.

As part of our collaboration, I would to like expand the work that is being done to better align the province’s cow/calf sector with the OCFB program. We know that we need Ontario cow/calf producers to be involved in the program to make it sustainable. We have lost too many producers in all of our sectors of beef production. So we’re working with OCA, the Ontario Livestock Dealers’ Association, Beef Improvement Opportunities and OnTrace to provide more information such as carcass data to cow/calf producers and backgrounders to help them improve their sales numbers. We also continue to work with cow/calf operators who want to retain ownership of their calves right through the feeding process. There is a lot of work involved in that process, but we understand its importance to those cow/calf producers.

Finally, I’d like to thank the Ontario Cattlemen’s Association and Ontario beef producers for their support of the Ontario Corn- Fed Beef program. I look forward to our continued efforts as we make OCFB one of the very bright lights in Canada’s agri-food industry.